[Freightos Weekly Update] Ocean rates still high as new supply chain antitrust probes launch

Key insights:

Ocean rates were stable across all the major trade lanes this week, and remain extremely elevated. Some backlog created by the Lunar New Year (LNY) holiday may be helping to keep prices up, but with demand still strong and congestion still a problem, a significant rate decrease in the coming post-LNY weeks doesn’t seem likely.

Asia-US rates:
Analysis

• Asia-US West Coast prices (FBX01 Daily) dipped 1% to $15,511/FEU. This rate is 179% higher than the same time last year.
• Asia-US East Coast prices (FBX03 Daily) went unchanged at $17,866/FEU, and are 207% higher than rates for this week last year.

Ocean rates were stable across all major trade lanes this week, and remain extremely elevated. Some backlog created by the Lunar New Year (LNY) holiday may be helping to keep prices up, but with demand still strong and congestion still a problem a significant rate decrease in the coming post-LNY weeks may not be likely. 

The ports of LA/Long Beach reported progress in reducing the number of empty containers clogging their container yards by nearly a third so far this year, and the state of California has freed up multiple areas – including former fairgrounds and prison sites – for off-port container storage to ease some of the pressure. But even with these steps, congestion continues to plague Southern California as well as many other major ports across the globe.

As sky-high ocean rates have become the new normal, a coalition of European freight forwarders asked the European Commission this week to scrutinize ocean carrier behavior during the pandemic, while a new collaborative working group of antitrust regulators from the US, UK and several other countries was also launched to examine the issue.  

Meanwhile, the Freightos Air Index shows that, post-LNY, air cargo rates dropped last week by more than 25% from Asia to both N. Europe and the US West Coast.